A Study On The Terms Of The Most - Favored - Nation Treatment In International Investment Arbitration Proceedings

As a main legal settlement of investment disputes between investors and the host country, international investment arbitration plays an important role in the protection of investors’ interests, safeguarding the rule of law as well as the healthy development of international investment. Based on the practice of international investment arbitration, this paper analyses several key issues in international investment arbitration proceedings when MFN clause is applied, and accordingly our attitude towards this issue and the measures should be taken.The first part briefly describes the practice of international investment arbitration about MFN, and has a brief introduction of the main debates on the issue of MFN clause between those who are in favor of the application of MFN clauses to international investment arbitration procedures and those who are not.The second part analyzes several major issues of the application of MFN clause,namely the interpretation rules of the MFN clause, the standard of a "more favored" arbitration procedure as well as the particularity of international investment arbitration clause, and lastly analyzes the main factors related to the arising of these debates.The third part analyzes several issues of MFN clause in international investment arbitration in China, and points out the tendency of judicial practice of the current international investment arbitration. Considering the current development of China’s foreign investment and the protective nature of international investment to investors,China should adopt an open attitude towards the application of MFN clause to international investment arbitration procedure. What’s more, China should improve the international investment agreements and the way to apply MFN clause to make the negative impact on China minimized.In short, there are many reasons resulting in the issue of MFN clause in international investment arbitration. Although China has not yet met relevant issues ofjudicial practice, with the expansion of China’s foreign investment, the issue of the application of MFN clause to international investment arbitration proceedings will also be unavoidable for our country. Therefore, have an open attitude to the application of MFN to international investment arbitration procedures and take positive measures to response, to take use of the advantages and avoid disadvantages will be more conducive to our national development in the long run way.